Brand-tastic! Coca-Cola’s innovation sees customers “taste the feeling”

The world’s biggest beverage company drinks to its innovative success 

Welcome to Brand-tastic! It’s a three-part mini-series looking at the world’s most innovative companies in 2017 (according to Forbes).

Over the course of the next three weeks, I’ll be interviewing members of the C-Suite (CEOs, CMOs, CIOs, etc) from global brands, which have achieved fantastic feats of innovation – in other words, they’re brand-tastic!

First up is Coca-Cola – the world’s largest beverage company – which came in at number 79 on the Forbes list. I catch up with Jon Woods, General Manager at Coca-Cola (Great Britain and Ireland). In our extended interview (which has been lightly edited), Woods talks about Coca-Cola marketing to millennials, the company’s “70-20-10” rule and brands having a point of view on social issues.

A bottle “Love Story.” Credit: COCA-COLA GB

Jon, you are the General Manager at Coca-Cola GB & Ireland – a position you have held since 2010. Outline the remit of your role and explain how it interfaces with the overall direction of the UK arm of the Coca-Cola brand.

I’m responsible for all aspects of the company’s business in Great Britain and Ireland. We have 20 brands – led by Coca-Cola – one of the world’s most valuable and recognisable brands. Beyond Coke, we have a wide and expanding portfolio including Fanta, Sprite, Smartwater, Schweppes, Appletiser and Honest.

Coca-Cola ranked 79th on the Forbes list of the world’s top 100 innovative companies in 2017, which means that investors identified Coca-Cola as one of the firms they expect to be innovative now and in the future. Citing an example(s) from Coca-Cola GB, what are the hallmarks of an innovative product, service, brand partnership or social impact initiative?

The first Coca-Cola was sold in the UK in 1890 – more than 100 years ago. We’ve come a long way since then and we continue to put our consumers first and respond to their needs. People here in the UK are more health conscious than ever before and they also face more choice in every area of their lives.

At Coca-Cola, we’re embracing the future. For me, this means re-thinking what’s both inside the bottle and the bottle itself. Inside the bottle, people tell us that they want (and expect) us to reduce sugar when possible, so we’re focusing on reducing sugar without sacrificing taste. Since 2005, we’ve launched 29 drinks with less or no sugar and we’ve invested ￡15m in the last three years alone on changing recipes – removing thousands of tonnes of sugar from the British diet. More recently, we launched a new recipe for Fanta Orange with one-third less sugar. It’s the second time we’ve reduced sugar in Fanta – a process which began in 2006. 

We also recognise that not everyone wants a carbonated drink, so we’ll continue to broaden our portfolio of different drinks to meet consumer demand. Broadening our portfolio of drinks is a long-term, global business strategy and I’m proud to say that Great Britain has been one of the countries that have pioneered this approach. We’ve made investments in categories, such as adult sparkling and still drinks. In 2017, Honest (our first organic herbal tea drink), Smartwater sparkling and Appletiser joined our range. There are also exciting new launches in new drink categories lined up for 2018, so watch this space!

The packaging is also important. We’re providing convenient, smaller packs (like our 150ml mini cans), so people can control their sugar intake more easily. We follow the UK Government’s “traffic light” labelling scheme, so people can make informed choices without the guesswork.

We’ve made significant progress to improve the sustainability of our packaging. For example, all our bottles and cans are 100 per cent recyclable. But we believe we can go further, so we’ve released our sustainable packaging strategy in Great Britain – with a commitment to double the amount of recycled plastic across our portfolio by 2020. Recently, I was in Lincolnshire at Clean Tech – the UK’s largest plastic recycling facility. As a long-term partner of ours, they will help us meet our ambitious target. It’s amazing seeing the scale of the operations. However, only 57 per cent of plastic is recycled. We need to recover more to be able to move beyond this target. 

Coca-Cola is launching a “smart” digital vending machine in New Zealand. Powered by artificial intelligence (AI) and utilising Facebook Messenger as a customer chat platform, the vending machines will be cloud-connected, enabling customers to make cash and card-free Coca-Cola purchases via their smartphones – even before they reach a machine. The vending machines will also give customers the opportunity to buy Coca-Cola for people in another location, including a different country. Are there any plans to roll-out smart vending machines in the UK?

We don’t currently have any plans to roll-out the smart digital vending machines here in Great Britain but, of course, we’ll look at how they’re received by consumers and consider adopting the technology in the future. 

In a 2013 interview, you expressed the following opinion: “Brands should have a point of view on social issues and use the brand voice to shine a light on a subject, cause or belief.” What risks do brands run by not taking a stance on social concerns?

The consumer should always sit at the heart of everything a brand does. Building a brand that is socially conscious or stands for a cause or belief should build better brand loyalty, engagement and a longer-term relationship with people.

Increasingly, brands need a clear purpose and vision to succeed. A recent example of us taking this approach was when we launched our “Love Story” advert, which was a moment for us to use the power of our brand to communicate the importance of recycling our bottles. The beauty of the creative is that it reminds people that our packaging is valuable because it can be recycled into more packaging over and over again. It’s Coca-Cola’s largest consumer communications campaign about recycling to date.

In 2013, you also said that Coca-Cola’s marketing mix relies on 70 per cent tried-and-tested techniques with a clear return on investment, 20 per cent innovation from a proven foundation and 10 per cent totally new concepts. Is this still the case today?

The “70-20-10” rule still guides our marketing strategy and our approach to media buying and investment. More broadly, it helps to frame conversations around risk-taking.

Although we’re a global business with hundreds of brands, adopting a local mindset and thinking about how we can take risks to speak to people in different ways is crucial.

According to data published last year by e-commerce and analytics provider, Connexity, Coca-Cola and its closest competitor are facing challenges successfully marketing to millennial consumers – both cola brands are under-represented in the 18 to 24 year old category. Given that millennials are typically sceptical of marketing, what plans (if any) does Coca-Cola GB have to capture their “hearts and minds”?

To engage in more meaningful ways, we’re working with new channels that are opening up to our audiences every day. Our core target audience is young adults and we know digital is the core channel to engage with this group. To date, the Coca-Cola GB marketing campaign that was most successful among millennials was the re-launch of Coca-Cola Zero Sugar, which helped drive spontaneous awareness significantly over the campaign period among the target audience and, most importantly, it drove sales.

Coca-Cola Zero Sugar is, by far, the fastest-growing cola in the category. However, big budget activity is not always the answer, especially when you consider the range of brands we have. Honest Tea is a strong example of how we brought a product to market in less than six months and created a bespoke commercial and marketing strategy – really thinking like a start-up brand. From only selling in key targeted outlets to a niche sampling campaign and focused PR campaign, every stage of the marketing campaign was tailored to the core audience.

British singer, Rita Ora, in the Coca-Cola Zero Sugar Taste Lounge. Credit: COCA-COLA GB

The “Share A Coke” campaign, which saw Coca-Cola customers looking for their names on Coca-Cola bottles, is an example of effective personalised marketing. Australia, which first launched the campaign, reportedly saw a three per cent increase in Coca-Cola sales. What impact did the campaign have in the UK, both in terms of sales and brand engagement? 

The “Share A Coke” campaign is one of our most popular global campaigns and it’s fair to say it sparked the personalisation trend that is still relevant across the marketing industry today. The success in the GB market mirrored the results seen in Australia and, this summer, we combined the “Share A Coke” proposition with insights around millennials’ love of travel and created bespoke destination-themed packs. The competition is the most entered on-pack offer in Great Britain.

“Share A Coke” personalised bottles. Credit: COCA-COLA GB

Coca-Cola GB supports reforms to the Deposit Return Scheme (DRS) in which Coca-Cola customers pay a deposit that is refunded when they return used Coca-Cola bottles and cans to shops and supermarkets. What reforms would Coca-Cola GB like to see made to the DRS and why?

Here in the UK, recycling rates are stalling and it’s clear that more needs to be done. Around the world, we’ve been involved in the implementation of well-designed deposit schemes and we’ve seen the positive impact they can have as part of a holistic approach to packaging recovery.

Earlier this year, we announced a new sustainable packaging strategy, which focused on three key areas. The first step is to double the amount of recycled plastic in every one of our bottles in Great Britain over the next three years – from the current 25 per cent to 50 per cent by 2020. This is a huge commitment to the UK recycling industry and will help create a “circular economy” for our bottles.

We also launched an advertising campaign in Great Britain designed to inspire people to recycle, which will reach more than 35 million by the end of 2017 and we’ll continue to move forward with more campaigns into 2018. Additionally, we said that we would look at how we can help support and drive packaging recovery to help change behaviour and reduce litter.

For some time, it’s been clear that both Scottish and UK governments are assessing how a DRS scheme could work. From our experience of successful DRS in several European countries, a well-designed DRS is one which is simple for consumers to use, cost-efficient to run, reduces litter and increases recycling rates. Any scheme must not only be effective, but efficient to operate and work for all parties – consumers, retailers, waste management companies, local authorities and manufacturers like ourselves.

It may surprise many people to learn that we only represent less than one-fifth of soft drinks packaging in Great Britain. It’s one reason we need everyone to come to the table and play their part in how they can help to make this work. We’ll continue to work alongside the Governments – both in Edinburgh and London – to help in any way we can to explore initiatives that can help tackle the recovery of litter. 

Credit: COCA-COLA GB

Coca-Cola GB is a partner of StreetGames, a charity that makes sport “more widely available for young people living in disadvantaged communities throughout the UK.” List the tangible benefits of this partnership since it was formed in 2010.

StreetGames has just celebrated its 10th anniversary and I’m proud we’ve supported the charity for seven of those 10 years. In that time, they’ve grown from supporting a network of 120 local delivery partners in England and Wales to supporting more than 900 doorstep sport deliverers in its network today.

Between 2013 and 2017, the StreetGames network of providers established 1,000 doorstep sport clubs engaging 118,000 young people from disadvantaged communities in sport and other physical activity. Over the years, Coca-Cola GB has invested several million pounds with the charity and provided millions of pounds worth of value in-kind. As a result, 210,000 young people have directly benefited from the programmes enabled by the company’s partnership with StreetGames.

What does the foreseeable future hold for Coca-Cola GB?

It’s an exciting time for the company at the moment. We have a new CEO – James Quincey – the first Brit to lead the company globally. He has previously led our business in Europe and so is well aware of the opportunities and challenges we face here. He has already instilled a renewed sense of purpose and drive in the organisation.

There are changes already happening in the business, which will see us continue to expand and diversify the range of drinks we offer to meet changing consumer tastes and needs as we truly become a total drinks company. There will be a number of new products and brands coming to market in 2018, which I’m excited about and believe will resonate with British consumers.

Coca-Cola’s tips to the top

1.     Know when to set trends

Coca-Cola is no stranger to innovative advertising – from painted wall murals in the 1890s to neon lights in 1955.

In August, Coca-Cola set tongues wagging in the advertising industry when it unveiled its latest creation – the world’s first (and largest) 3D robotic billboard. The six-story structure – situated in New York’s Times Square – features 1,760 LED screens, timed to independently move in sync with the content being displayed.

Coca-Cola’s timing was impeccable. The 24-hour robotic billboard (which took four years to design and test) comes nearly 100 years after the drinks company installed its debut sign in the iconic location. The result? Guinness World Records awarded Coca-Cola two new records: one for “the first 3D robotic billboard” and the other for “the largest 3D robotic billboard.”

In 1969, Coca-Cola’s signage simply stated, “It’s the Real Thing.” In 2017, Coca-Cola strategically selected Times Square (which is widely known as the “crossroads of the world”) to publicly cross over into the era of AI in an engaging, crowd-friendly and aesthetically pleasing way.

2.     Know when to follow trends

In the last couple of years, Apple and Amazon have (literally) been the talk of the town with their intelligent voice assistants, Siri and Alexa.

Spotting a highly popular trend set by two tech giants, Coca-Cola has shown no hesitation whatsoever in jumping on the AI bandwagon with its next-generation AI-powered vending machine app.

The app, which launched in July on several U.S. university campuses (and in Australia and New Zealand), allows customers to order Coca-Cola for themselves and a third party and have the drinks reserved in a vending machine. The AI technology also enables the vending machines to adapt to their environment – with more animated machines in shopping malls and more functional machines in hospitals.

Five facts about...Coca-Cola 

1.     Founder(s)/founded: John S. Pemberton in 1886.

2.     Headquarters: Atlanta, Georgia.

3.     Employees: 100,300 (worldwide) as of 31 December 2016.

4.     Fascinating fact #1: According to the Coca-Cola Company, “Coca?Cola” is the second most-widely understood term in the world, after “okay.”

5.     Fascinating fact #2: Business Insider reported that the Coca-Cola logo is “recognised by 94 per cent of the world’s population.” 

Coca-Cola continues to refresh the soft drinks scene

Coca-Cola Plus Coffee No Sugar. Credit: COCA-COLA GB

Ranked the number one beverage company (and the fifth-ranked company overall) on the Forbes list of the world’s most valuable brands in 2017, Coca-Cola is the world’s leading soft drinks brand. It’s the largest beverage company on the planet with 1.9 billion servings of Coca-Cola products reportedly being consumed every single day. (Coca-Cola GB is in the top 10 fast-moving consumer goods brands in the UK.)

But Coca-Cola has outgrown its namesake brand. In recent investor presentations and earnings calls, the company has been pitching itself as a “total beverage company” with Coca-Cola selling 3,900 still and sparkling products worldwide. The company has 21 billion dollar brands under the Coca-Cola banner but, conscious of public health concerns and the growing obesity crisis, 19 of these brands are of the reduced calorie, low-calorie and no-calorie variety.

Coca-Cola’s latest venture is a limited edition “Coca-Cola Plus Coffee No Sugar” product, which combines the best of both worlds – Diet Coke and coffee. Better still, it doesn’t contain sugar. Unfortunately, it’s only available in Australia – at least for the time being. With any luck, Coca-Cola and coffee fans all around the world will soon get an opportunity to “taste the feeling,” too.

If you like Brand-tastic! you may want to check out some of my other articles here on LinkedIn:

• Series 1: Branding Bosses: World’s Most Valuable Brands (according to Forbes)
• Series 2: Branding Bosses: Iconic Brands
• Series 3: The Founder